Actions can speak louder than words

In last month’s Accountancy  we reported on the MasterChef US case in which an unsigned deal memo was held to be binding on the relevant parties. In that case, the court confirmed that the parties’ conduct would be key when deciding whether there was a binding contract. Another recent case, The Sherlock Holmes International Society Limited v Aidiniantz [2016] EWHC 1076 (Ch), has emphasised that contracts can be created or amended by conduct without the need for a formal written agreement.

The case concerned the company running the Sherlock Holmes Museum in Baker Street. The company’s sole shareholder had obtained a winding up order against the company on the grounds of insolvency. The company’s sole director launched an appeal against the winding up order. The shareholder challenged the director’s appointment and, therefore, his ability to authorise the company to appeal the winding up order.